Debating Warren Redlich’s “Real Tort Reform”

Cyrus Dugger

Debating Warren Redlich’s “Real Tort Reform”

After linking to a critique of “health courts” from a supporter of tort “reform” on the Stop Wasting Money Blog for my post Even a Tort “Reformer” Opposes “Health Courts,” I encouraged the author of the blog to outline why he generally supports tort “reform” (although he obviously opposes the specific tort “reform” of health courts).The author, Warren Redlich, an unsuccessful Republican candidate for Congress, supports eliminating non-economic damages in cases of simple negligence.

Warren rose to the challenge, and apologies to him for taking so long on my promise to respond (definitely not the result of a lack of interest… I was just tied up).

Also, please don’t mistake any of my arguments for a lack of respect for Warren’s point of view. I simply disagree with his viewpoint, and I hope to demonstrate why the facts and common sense strongly support my position.
I hope that this debate can start a respectful and interesting discussion about the merits or lack therefore of tort “reform.” I’m going to do a series of posts on each section of Warren’s argument so that the discussion does not became overwhelming given the large amount of important points at issue.

I hope to write one of these critiques each week.

So here’s Warren’s proposal:

Warren: I mentioned briefly my own proposal for tort reform in my last post. Cyrus Dugger from tortdeform.com encouraged me to describe my proposal in more detail, after I mentioned I was thinking about doing so. So here we go …
“ It’s a simple proposal - eliminate pain and suffering damages for cases of ordinary negligence. Pain and suffering damages are sometimes referred to as “non-economic” damages. This contrasts with lost wages, medical bills, and other easily measured damages. It is also the area of damages targeted by most proponents of any kind of tort reform.”

A couple of points:

• If the problem is non-economic damages why not simply eliminate them entirely? You either believe that they are the kind of injury that should be compensated or not. The level of misconduct of the perpetrator of the injury doesn’t affect the existence or non-existence of a person’s injury. So, why should it be denied in some cases, but approved in others based solely on how whether the perpetrator of the injury was just careless or incredibly careless? Either way the victim is harmed just the same and potentially just as much.

• Warren intentionally or unintentionally blends “non-economic damages” with “pain and suffering.” In fact, non-economic damages compensate a whole host of other kinds of harm. Non-economic damages are best categorized as including all sorts of injuries aside from “wages, medical bills, and other easily measured damages” including: disfigurement, physical pain and suffering mental anguish, loss of enjoyment of life, loss of limbs, loss of fertility, disfigurement, the lost love and affection family members, and a longer list of many things that are just so horrible that they are hard” to quantify” or attach a dollar “value” to. If you would have a problem not receiving compensation if another person’s carelessness caused any of these types of injuries, then you don’t really support Warren’s proposal on its face.

• Granted, Warren technically leaves open the possibility of awarding these damages when there is “gross negligence,” but proving this level of misconduct is incredibly difficult when the acts are not already obviously intentional. Here’s two posts describing the effect Warren’s proposal would have in the medical malpractice liability context. (Launch: Tort Victim Tragedies & The Victims of Senate Bill 3) Indeed, the tort “reform” movement often attempts to frame non-economic damages as solely related to “pain and suffering” in order to minimize and debase the great variety of significant harms actually at issue.

• Warren even acknowledges the injustice of not compensating people for “non-economic” damages in his previous post when he gives this example of the injustices that health courts can create “I’ve got a couple clients who were raped in the health care system, one by her doctor (his license was revoked) and another by a nursing home aide with a long criminal record. Neither of my clients have substantial or long-term physical injuries. What do they get under this schedule?” I ask Warren’s question…. of Warren… in the larger context of all tort actions with similarly non-economic injuries.

• The larger question is why are we considering making this change at all? Warren argues later on in his piece that it will reduce the cost of insurance. While we’ll address this assertion in detail in a future post, his framework begs an important question 1) Even if he’s right, will these saving be transferred to insurance policy holders or insurance companies? Most accounts of the current historic profitability of insurance companies point to the answer being “no.” Indeed, multiple reports have found that home and auto insurers have been price-gauging consumers while making record profits.

More points to come, and thanks to Warren for starting a great discussion.

Posted at 9:21 AM, Feb 08, 2007 in Permalink | Comments (1) | TrackBack (0)

Comments

I write first to thank you for mentioning me again, and second to respond to your comments.

Regarding the idea of eliminating non-economic damages completely, I don't have strong feelings one way or another. I was trying to propose a more moderate reform.

You miss my point when you say the "perpetrator" in an ordinary negligence case was "careless." In many personal injury cases that I've seen, the alleged tortfeasor is accused of something that we all do - it might be a rolling stop or driving 5 mph over the limit. The "ordinary negligence" standard is such a low bar to get over that we're all guilty of it on a daily basis, maybe hourly.

My use of the term "pain and suffering" was not meant to minimize what people go through. It is the shorthand that we use in personal injury law in New York State. If I'm somehow minimizing this concept, then you are exaggerating it. You even used the term "disfigurement" twice. The plaintiff does not (at least not in NY) get compensated for the disfigurement/limb-loss/etc, but for the pain and suffering that results from that injury. To me this critique is just semantics (as is my response).

In two out of four the tragic stories you refer to, the tragedy is compounded by denial of economic damages, something where I did not (and do not) suggest restrictions. Also, the Georgia ER standards is not merely gross negligence, further requires clear and convincing proof. You describe the "gross negligence" standard there as knowingly mistreating someone. I don't know if I defined gross negligence in my post(s), but to me the standard you describe is a bit tougher than what I had in mind. Knowingly mistreating someone sounds awful close to an intentional act, which is a different world entirely.

On your "injustice" point, the simple truth is that there is no perfect system. The guy who is struck by lightning doesn't get compensated for his injuries, so maybe that's unjust too. Some deserving plaintiffs lose because judges and juries sometimes make bad calls. I've had a couple of those experiences.

In talking about injustice of the individual, you ignore the collective injustice of consumers spending all this money on car insurance. For each plaintiff who gets compensated with a $1 million award, there are thousands of consumers who collectively lost $2 million or more in the process.

I agree with you that most tort reform proposals we see will not significantly reduce insurance rates. The Georgia ER proposal would be difficult to evaluate because I don't think ERs have separate insurance rates. They're probably lumped in with the whole hospital. Any impact on premiums is hard to see because the ER may be only 10% of the hospital. Malpractice premiums are typically highest for surgery and Ob/Gyn. I confess I'm shooting from the hip here, but I think I'm roughly accurate.

New York State added the Omnibus Workers Compensation Reform Act to reduce tort liability rates for employers. It did not reduce rates. The reform was fairly significant in how it limited cross-claims by others against the employer, but in reality its impact was limited to relatively few cases and it just shifted responsibility around a bit. The Courts did throw a bone to the insurers on that one, deciding that the law would be retroactive, thereby restricting old claims. Someday I'm hoping someone can tell me how eliminating old claims can decrease rates for future claims.

I believe my proposal is different. Unlike the Georgia ER and NY Workers Comp reforms, it would be broad and the insurance impact would be widespread.

Your comments about insurers reflect a bias on your part. Insurers are supposed to make profits. If they didn't, no one would be in the insurance business and plaintiffs wouldn't get compensated. I have my own biases with regard to insurers. There's a videogenic lizard out there I'd love to squash.

In many places insurance is a competitive market. NY has many insurance companies vigorously competing for customers, and they do compete on price. If my proposal were to go through, I assume you agree that it would reduce claims made on these insurers, and reduce them dramatically. This would mean insurers would have lower costs and they would be able to sell insurance at lower rates. Competition would then drive them to do so. If you don't believe that, you simply don't believe in capitalism and markets. I don't know how you can justify such a view in the face of what we've seen with the computer industry.

Even so, there would be limits on the impact of my proposed reform. Liability premiums would be reduced, but the change would not affect collision and comprehensive, which are major components of the insurance bill for many car owners. It would not affect fire claims or Katrina-like claims for homeowners either.

I do think my reforms might lower medical claims in car insurance cases. I have seen quite a few cases where plaintiffs continued to seek treatment because that would strengthen their claim for pain and suffering. This might or might not be a big impact.

Thanks again for mentioning me on your blog, and giving me an opportunity to make my pitch.

Warren